FW
Nitin Spinners recorded a mixed quarter where their total income was up 19 per cent at Rs 190.5 crores versus Rs 160 crores in the same quarter last fiscal. But other income was lower at Rs 0.02 crores compared to Rs 1.18 crores YoY. Finance costs too were up 55 per cent at Rs 8.7 crore versus Rs 5.6 crore YoY. The margins for the quarter were at 18.5 per cent.
The company’s managing director Dinesh Nolkha is confident of a 26-27 per cent topline for FY16 and maintaining EBITDA margins around 18.5 per cent. For FY17, the company has plans to increase capacities which would come on stream by year-end, according to Nolkha. The company’s exports too are doing well and are expected to do better going forward.
Nitin Spinners manufactures cotton yarn and also has fabric manufacturing for knits. Their 80 per cent of the revenues is generated from yarn and 20 per cent from knits. Its 65 per cent of revenues are from exports.
Garment makers in Bangladesh want to set up a warehouse in West Bengal. If the proposal goes ahead exporters from Bangladesh are also interested in setting up a garment park alongside.
The warehouse will help garment manufacturers in Bangladesh supply apparels directly to retail shops across India. Although India provided duty-free and quota-free market access for all Bangladeshi goods, except 25 alcoholic and drug items in 2012, it levied a 12.5 per cent countervailing duty the following year, which hampered garment exports.
Bangladesh exported garment items worth $104.25 million to India in fiscal 2014-15, up 8.3 per cent year-on-year. The country's overall exports to India were worth $456.63 million in fiscal 2013-14, compared to $563.97 million a year earlier. Bangladesh’s imports from India were at $6.03 billion in fiscal 2013-14 and $4.78 billion a year earlier.
India is a very big market for Bangladeshi apparels, as its annual retail market size is set to cross the $40 billion dollar mark thanks to its growing middle class. Bangladesh seeks to boost its annual garment exports to the Indian market to a billion dollars in three years from the present $100 million.
As per a India Ratings and Research (Ind-Ra) report, domestic cotton prices to remain under pressure in 2016-17 due to continuation of Chinese direct subsidy-based policy and lower demand from spinning mills. Though Bangladesh, Pakistan and Vietnam have replaced China with India as a supplier, volumes are picking up at a slow pace, and are unlikely to match Chinese demand. During April-December 2015 India produced 28.5 million bales as against 29.5 million bales in FY15 and 31 million bales in FY14 against which exports have been 5.3 million bales (4.2 million bales in FY15 and 9.3 million bales in FY 14).
In CY17 (International Cotton Year, which commences from August and ends in July), the ratings agency expects cotton prices to stay firm. Domestic prices had declined in CY16 in line with Ind-Ra's expectations and are expected to remain under pressure in CY17 as well. According to the rating agency, the international cotton prices, however, will remain sensitive to the release of cotton by China from its cotton reserves, which Ind-Ra estimates to be around 59 per cent of global cotton stock at FY16.
Chinese cotton reserves will directly impact the quantum of imports in that country and consequently, global stock levels outside China, the report added. The cotton industry is likely to revive moderately in CY17 as exports to Vietnam, Pakistan, and Bangladesh grow. Vietnam is likely to increase its spindles capacity by 30 per cent in FY17.
The local cotton production in Pakistan and Bangladesh is unable to keep pace with the increasing demand for apparels from these locations, providing opportunities to Indian exporters.
Textile companies are working toward eradicating harmful chemical substances from their clothing supply chain. They are creating an auditing protocol, tracking progresses, publishing case studies and showing transparency through the publication of testing results. Some have chosen the chemical management gold standard by which all other fashion brands and sectoral hazardous chemical initiatives will be measured. Now that their own suppliers are committing to eliminate hazardous chemicals, these brands have no excuse but to follow suit.
Hazardous chemical groups that need to be removed include perfluorinated compounds, brominated and chlorinated flame retardants, organotins compounds and amines associated with azo dyes that can have negative effects on human reproductive systems and cause cancer.
Other areas where hazardous chemicals need to be eliminated include yarn production, fabric production, textile raw material production, yarn dyed and fabric dyed. Some 35 international fashion and textile brands and retailers—representing more than 15 per cent of global textile production in terms of sales—have already committed to a toxic-free future. Among the participating companies are Miroglio and Inditex, as well as Valentino, Adidas, H&M and Burberry.
Greenpeace’s Detox campaign aims to lead the industry toward eradicating all harmful chemical substances from the clothing supply chain by 2020.
Advanced flat knitting technology is now poised to revolutionize the sport of lacrosse. Lacrosse is a contact team sport played between two teams using a small rubber ball and a long-handled stick sometimes called a ‘crosse’. The head of the lacrosse stick is normally strung with loose mesh designed to catch and hold the lacrosse ball and it is this mesh which is being replaced with the engineered flat knit.
Sportswear and sports equipment giant New Balance has launched The Warp, a lacrosse stick incorporating an engineered flat net knitted on a Stoll CMS flat knitting machine, which is designed to catch and hold the lacrosse ball.
Each knitted pocket consists of 2,536 knitted rows, takes 1,604 machine carriage strokes with 513 stitch transfers, and is knitted in one piece with every single stitch engineered to specification. So there is no need to adjust strings before the game, between whistles, or on the sidelines. In fact, there are no more strings.
The pocket comes game ready. Unlike mesh that comes flat and hasn’t been created specifically for the head, the warp’s pocket shape is engineered with a three-dimensional knitting process, molded directly into the head. This means the pocket works in perfect unison with the entire head.
India has made changes in the duty drawback scheme to help boost exports. These industry rates of duty drawback will be effective immediately. New entries in the drawback schedule have been created for cotton yarns mixed with manmade fiber - both grey and dyed. It has also increased the drawback caps in the case of certain manmade fabrics. There is a separate entry for cotton yarn mixed with manmade fibers.
However, in product coverage some clarifications are needed with regard to the classification of some high-valued items like boiler suits and protective wear made of blends containing cotton and man-made fibers.
Duty drawback is a refund of duties on imported inputs for export items. Drawback caps are imposed on several export products with an aim to obviate the possibility of misuse by over invoicing of the export value. Steps have been taken for the smooth implementation of the three per cent interest equalisation scheme. Problems faced initially by some exporters in getting the benefit from their banks have been largely resolved.
Even though Indian cotton textiles products are competitive in world markets, preferential access being given to some of the competing nations like Bangladesh, Cambodia, by major importing countries like the EU, are affecting exports.
Pakistan’s low cotton output may hurt millions of families in the farming communities, which would ultimately affect exports and the gross domestic product. The country would miss the target of cotton production by 4.6 million bales, necessitating imports worth four billion dollars to keep the textile industry running which would hit the balance of payment situation and forex reserves.
Cotton is the backbone of Pakistan’s economy. It holds a 8.5 per cent share in the GDP, fetched 12 billion dollars through exports and provides jobs to 40 per cent of the labor. The reasons behind the low cotton output include sudden and unpredictable rains, drought in some areas, low cotton prices and a hike in prices of inputs by 15 to 20 per cent and the use of substandard seed and fake pesticides, which discouraged farmers.
The sowing target of cotton was also missed, with potentially disastrous consequences. Genetically modified seeds were introduced in the hope they would be pest resistant. But the imported seeds failed to withstand pink bollworm and whitefly attacks while sprays and medicine to tackle the pests were not available in the market. So the pests played havoc with the crop.
Cotton producers in the United States could plant up to 9.1 acres of cotton this coming spring, up 6.2 per cent from 2015. In the mid-south, growers intend to plant 1.2 million acres, which is a 24.9 per cent increase from last year. Growers in the southwest are eyeing 5.3 million cotton acres, which indicates a 6.1 per cent leap.
Elsewhere in the US, far west cotton producers expect to plant 2,13,000 acres, totaling 24.4 per cent more than what was recorded in 2015. The southeast is the only region with an expected decrease of 5.1 per cent, reducing its total to 2.1 million acres.
Planted acreage is just one of the factors that will determine supplies of cotton and cotton seed. Ultimately, weather, insect pressures and agronomic conditions play a significant role in determining crop size. Upland cotton intentions are 8.9 million acres, which is a 5.7 per cent jump from 2015. Extra-long staple intentions of 2,08,000 acres make up a 31.2 per cent increase.
History has shown that US farmers respond to relative prices when making planting decisions. Cotton is grown in 17 states stretching across the southern half of the United States. Cotton is produced on about 18,600 farms in the US.
The latest edition of Milano Unica was held in Italy, February 9 to 11, 2016. It was dedicated to fabrics and accessories and showcased collections for the spring/summer 2017 season. It had 371 exhibitors, 72 from outside Italy, as opposed to 361, 64 from abroad. Added to these, 40 Japanese companies and 13 Korean fabric manufacturers were featured in the Japan and South Korean observatories. Altogether the show hosted 424 exhibitors compared to 399 in February 2015, an increase of six per cent.
In the next September edition, the show will relocate and enjoy a complete makeover of its facilities. The reason for relocation is that the event wants to occupy a bigger space. Italy’s benchmark textile show will adopt for the occasion a new floor plan, built around a central square, a reference to a typical Italian piazza. The idea is to become an event open to international excellence, in order to create synergies with Italian know-how.
The underlying project appears to be that of bringing together several events linked to the fashion world in one place at the same time. Stress has been laid on the importance of team-work and of pooling energies together around a single, coherent project.
www.milanounica.it/
Cotton farmers in Andhra Pradesh are getting remunerative prices. They are probably benefiting from the crop damage in Pakistan, Bangladesh and China. The remunerative price has crossed Rs 4,600 per quintal, which is almost Rs 500 higher than the minimum support price. The average price in the last three years was hovering between Rs 2,500 to Rs 3,000 per quintal. Prices have jumped nearly 100 per cent from the previous season. In anticipation of a further price rise, farmers have, so far, sold just around 8 to 9 lakh bales against the total production of around 22 lakh bales.
Spinning mills who are the main buyers say farmers are refusing to part with their stocks even at prices of Rs 4,500 per quintal. So these mills fear coming under pressure in the coming weeks as the global markets are also indicating low production. The crop damage in Pakistan, Bangladesh and China has triggered a demand in global markets. Pakistan has, so far, imported nearly 30 lakh bales from the total exports of 45 lakh bales from India. India's exports too are expected to go beyond the normal 80 to 90 lakh bales.
On the whole the scenario has come as a relief for Andhra Pradesh’s cotton farmers who had witnessed huge losses in the last three seasons.
